Falendra Kumar Sudan Department of Economics University of Jammu, India Jennifer McKay

1. Water Pricing and Participatory Irrigation Management: Experiences and Lessons Learnt from Integrated Watershed Development Project in Jammu and Kashmir, India ICID 7th Asian Regional Conference, Adelaide 26 June, 2012 Falendra Kumar Sudan Department of Economics University of Jammu, India Jennifer McKay Centre for Comparative Water Policies and Laws, University of South Australia, Australia

2. Background Objectives of the paper Methods PIM under IWDP (HILLS-II) Impact of PIM Users Responses to Increased Water Pricing Reasons for Low Cost Recovery Cost Recovery and Reducing Water Use Lessons Learnt Content of Presentation

3. Participatory Irrigation Management (PIM) Water Users’ Associations (WUAs) Market failure and government failure conservation of land and groundwater resources through rainwater harvesting Participatory Watershed Development for protection and sustainable use of land and water resources Institutional arrangements (users’ associations) clearly defined rewards and sanctions WUAs responsibility for operation and maintenance (O&M) of canal systems below certain point to local farmers Background

4. Integrated Watershed Development Project (IWDP), Hills-II, Jammu and Kashmir encourage the formation of WUAs eventually want to transfer irrigation management to irrigators Initiatives of IWDP, Hills-II seen as first step towards operationalizing water pricing attaining sustainable irrigation water resource management Background

5. To review relevant literature on water pricing and PIM To analyze the process and impact of evolving PIM under IWDP, Hills-II, users’ responses to water pricing and reasons for low cost recovery To suggest policy recommendations to recover project costs and collect water charges from users Objectives of the paper

6. Collection of primary data and information well-structured and pre-tested questionnaires participatory rural appraisal (PRA) techniques group meetings Sample size 90 members of WUAs 780 households Six WUAs (three each from selected sub-watersheds) Twelve villages (six each from ‘project’ and ‘non-project’ area) Methods

7. Methods • Ramnagar SW • Project area with WUAs (185 HHs) • Project area without WUAs (119 HHs) • Non-project area (72 HHs) • Akhnoor SW • Project area with WUAs (158 HHs) • Project area without WUAs (72 HHs) • Non-project area (174 HHs) • Stratified sampling technique • WUAs, ‘project’ and ‘non-project’ • To make comparative study • “forested watersheds’ villages and agricultural watersheds’ villages” • Purposive sample: 20% HH level respondents • Content analysis technique

8. Irrigation system in watershed areas of J&K medium and small water harvesting structures and distribution channels Past neglect and mismanagement declined utilities in irrigating crops IWDP (Hills-II) started modernization and repair initiated treatment of catchment areas Involvement of user groups repair, maintenance and improvement of physical structures water management on cost-sharing basis (voluntary free labour) Introduced significant institutional reforms revive and strengthens community institutions clearly defining rights and obligation for users’ communities PIM under IWDP (HILLS-II)

9. Formation of WUA Process of formation of a WUA - relatively simple Election process highly democratic and fair conducted in a participatory manner Location of WUAs physical infrastructure for irrigation already existed repairs and maintenance Identification of user-farmers participatory development staff and village leadership Tenure of WUA: one year Separate bank account signatories to bank account: president and a member PIM under IWDP (HILLS-II)

10. Operation of irrigation system Entire reform process repair and renovation oriented Majority of works done through WUAs along with panchayats fair and impartial manner proper records of all financial transactions maintained contracts given in a fair and just procedure Cost of works done by WUAs: 25% lower than contractors Transparency in WUA functioning assured technical and financial estimates funds disbursements works execution by local farmers No new structures, or alteration of original designs emphasis on restoring original designs PIM under IWDP (HILLS-II)

11. Allocation rules Credibility of WUA depends on ability to ensure equitable distribution of benefits penalize any free rider Rules in use share of water determined by land acreage water rationing rotational use of water in rice cultivation collective patrolling to avoid breaching of channel WUA decides extent of area to be cultivated timing of start of irrigation in a particular season Irrigation system confronted with numerous problems rationing supplies equitable sharing of shortfall in supplies among all users PIM under IWDP (HILLS-II)

12. Maintenance of irrigation system ‘Maintenance’ to ensure smooth functioning of physical facilities Common interest stronger in PIM users made a substantial contribution to cost of developing it WUAs established conventions regarding timing of repairs division of work responsibility of members obligations of users Provision of sanction (ranging from fines to loss of water rights) against non-compliance Large landowners dominated WUA functioning PIM under IWDP (HILLS-II)

13. Benefits and costs Potential beneficiaries mobilized on issue related to fair sharing of benefits and costs Users’ participation cost-effectiveness in repairs and maintenance efficient management of infrastructure interest in minimizing costs economical and efficient services equitable distribution of water Inequitable water distribution conflicts among users and members of users’ association PIM under IWDP (HILLS-II)

14. Transparency and accountability Transparency one of key principles of PIM strengthen confidence over functioning of WUAs informed activities undertaken to water users efficient management of irrigation systems Dissemination of information general body meetings on regular intervals Prioritize repair works to utilize available funds project functionaries as facilitators accountable and responsible to farmers’ organizations Executives of WUAs accountable to their members PIM under IWDP (HILLS-II)

15. Perceptible economic gains of PIM increase in land values by 10-15% better field drainage & reduced waterlogged conditions increase in area under cultivation ensure timely sowing of crops receipt of water at tail end new acreage added to irrigate lands increased productivity of rice, pulses, vegetables and orchards increased income from various crops cropping pattern shifted to commercial crops like vegetables and pulses Impact of PIM

16. Reduction in rainwater loss and sediment yield Micro-level watershed planning emphasis on soil erosion control on hill slopes and gullies regulation of water flow system in watershed drainage rearrangement of farmlands Adverse climatic conditions in the Shivaliks micro catchment techniques for run-off harvesting and conservation practices improved moisture retention run-off soil loss declined improving surface and ground water regime Impact of PIM

17. Status of water resources and irrigation Number of water points (bowlies) & gravity based water points per village Number of water harvesting structures Length of irrigation channel Better quality of water harvesting structures more in PA with WUA than without WUA and NPA Outcomes increased water potential increased irrigated cropping increased irrigation intensity Impact of PIM

18. Change in crop intensity and crop productivity Improved soil moisture regime, increased irrigation resources and high use of fertilizer (including cow-dung) improved cropping intensity in PA compared to NPA Better cropping intensity due to project interventions rainfed crop demonstration propagation of use of modern inputs through extension agents Increased average crop yield per hectare Impact of PIM

19. PIM & increase in water pricing 22% user demands less water and leaves land fallow 18% applies less water to crop accepting some yield loss 36% switches to less water demanding crops 43% invests in more efficient irrigation techniques Further rise in water charges water intensive crops no longer optimal farmers switch to other crops invest in more efficient water application techniques Users Responses to Increased Water Pricing

20. In water abundant area, price relatively low water quantity reduction policies more effective than water price policies In flood irrigation schemes, water pricing more efficient In drip systems, increasing water charges less effective Adoption of irrigation technologies water price land quality crop type Pricing induces upstream farmers to use water more efficiently Users Responses to Increased Water Pricing

21. Low water fee collection rates lack of farmer participation in planning & management poor communication lack of transparency between farmers and irrigation management poor water delivery service Water charges covers O&M: one-fifth cost-recovery rates: between one-fourth and one-third Responsibility for fee collection shifted to WUAs not clarifying water users’ rights and responsibilities no incentives for service providers to collect fees Reasons for Low Cost Recovery

22. Water pricing must covers appropriate costs users’ consultation and irrigation agencies Better irrigation services an incentive to pay fees & increased ability to pay with higher farm incomes Financial autonomy to WUA improve irrigation water management collect water fees from users to recover O&M costs Water pricing either volumetric or area-technology based Use of appropriate water-saving technology Cost Recovery and Reducing Water Use

23. Institutional reforms under IWDP (Hills-II) bold and innovative Better maintenance of physical irrigation system improved water availability Addresses key issues pertaining to irrigation management institutional structure, incentives, accountability, transparency, and sustainability Sustainability of WUAs essentially depends on their capacity to operate and manage on own Financial sustainability important in sustainability of WUAs to make the reform process a success Transparent consultation process farmers to participate in decision-making willingness to pay water charges ensure high cost-recovery Lessons Learnt

24. To encourage farmers to pay their water charges incentives for providing high-quality and timely water service penalties by stopping water delivery to defaulters, charging a higher rate for late payment Water charges to be equitable, administratively simple, and easily understood by users and collecting agency Use of other mechanisms to reduce water use per hectare area-crop and area-technology based water charges incentive to shift to crops that need less water to shift to water-saving technologies, or both Public awareness, education, and training programmes economic value of water understanding the importance of conserving water Lessons Learnt

25. Mechanisms to ensure accountability roles and responsibilities of all agencies concerned need to transfer all O&M to WUAs in near future Transparency to progress further simple and standardized procedures for accounting and finance Need to ensure replicability of the successes achieved Needed to form federations of WUAs, for which continued support and training required Involvement of NGOs and training institutes in upgrading skill and capacity building Regular monitoring mechanism to be put in operation to initiate corrective measures as and when needed Lessons Learnt

26. Thank you!